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Down trend intact whilst below the 5s

Published Tuesday, July 1st, 2014

The move below RBOB’s 13 day MA at 306.91 yesterday was the final nail in the coffin for the recent up-trend. The immediate result was that the contracts were unleashed south and headed for their short-term targets, which were all hit and held. The trend may be deemed to be down whilst the contracts remain below the short term MAs, the lowest of which are the 5s currently around 105.82 WTI; 113.02 Brent; 298.52 Heat; 305.94 RBOB and 920.50 Gasoil. These are sales on rallies. Any move and close (m/c) above by any contract would be a warning that the new down trend is in trouble and that yesterday may have been a “bear trap”. The most fragile time for any trend is in its first 24/48 hours so watch for this carefully. The stochastics are negative and will make any significant rally over the 5s, and then the 8 and 13s, difficult. Rallies to the short term MAs are sales. WTI hit its target to 104.99 (adjusted upwards from 104.30 mid-way through yesterday) and held. It has no target lower whilst above here. A m/c below would green light the next leg down to 104.41/22 area

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Posted by Robin Bieber